Symrise cements position as top four flavour firm

By Anthony Fletcher

- Last updated on GMT

Related tags: Flavor

Symrise's acquisition of Kaden Biochemicals is designed to
consolidate the company as one of the world's four largest flavour
firms.

The deal, which continues an ongoing pattern of recent growth, underlines how competitive the European flavours market has become.

Kaden Biochemicals has its headquarters in Hamburg, Germany. It develops and produces high purity active ingredients from plant material and is regarded as a major specialist in this area.

Symrise believes that Kaden's expertise complements its own competencies in flavourings and sensory ingredients.

"This acquisition gives us a good position on the highly attractive market for functional food and nutraceuticals,"​ said Dr Gerold Linzbach, CEO at Symrise.

"As a result, we can now offer a much broader spectrum, and we can present ourselves even more strongly as a source of comprehensive sensory solutions for nearly every challenge on the market."

Kaden Biochemicals is an owner-operated company in which Heinrich Kaden holds 90 per cent of the stock. In their search for new ownership, the management at Kaden decided in favour of Symrise, which now owns Kaden Biochemicals completely.

"Symrise was always my partner of choice when we were looking for a successor for my business,"​ said Kaden. " I am confident that these two companies suit each other perfectly in terms of their product portfolio."

The move follows Symrise' recent £1.5 million investment at its Nördlingen production site. The production facility, which specialises in the development and manufacture of flavourings and raw materials, is being expanded in order to meet growing demand - and growing competition - within this specific flavour sector.

Symrise believes that the establishment of the new pilot plant will create perfect conditions for developing and manufacturing innovative beverage flavourings to the standards demanded by the industry. The expansion projects are scheduled for completion in December 2006.

These developments comes at a time when the flavour industry as a whole is looking at new ways of increasing margins in what is becoming an increasingly competitive sector. The market for flavours has, historically, been dominated by suppliers from the US, Japan and Western Europe - in particular, France, the UK, Germany and Switzerland.

However these traditional flavour production areas could begin to lose market share to developing areas of the world as the product range and demand expands.

Globally, the flavours and fragrances industry is estimated at about €14.8 billion, of which the top five players account for 40 per cent of the market. Swiss firm Givaudan continues to lead the industry with an estimated 13.5 per cent slice of the market in 2003, followed by US International Flavours & Fragrances with an 11.7 per cent share.

Firmenich, equity-owned Symrise and ICI-owned flavours company Quest International are slated to have about 9.8, 9 and 6.1 per cent of the market respectively. Symrise reported sales of €1.14 million in 2004, and controls over 40 registered patents.

Related topics: Market Trends, Flavours and colours

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